Almost without exception, every auction begins with some opening remarks — or should.
Typically, an auctioneer will introduce himself, or herself, and also introduce the staff, likely note that bidders must register, items are selling “as-is” and “where-is” and acceptable payment arrangements, etc.
So what are the legal and/or problematic issues with the auctioneer’s opening remarks? There are two very material issues with opening remarks, which we’ll discuss in this article. Those points are:
When are the opening remarks to be made?
Can those remarks contradict other printed advertising or disclosures?
First, when are the opening remarks to be made? The obvious answer is: before the auction starts, but there is case law which suggests there are parameters for when opening remarks should be made — to be enforceable.
If an auction is to begin at 9:00 a.m., the courts have ruled repeatedly that the opening remarks should be made at 9:00 a.m. In fact, one such court in Ohio ruled that since the opening remarks were made prior to the start time of the auction, the bidders were not bound to those announcements.
Similarly, another court ruled that such opening remarks that were made about 10 minutes after the start time of the auction were not enforceable because bidders there at the start time would have expected to be informed at that time, rather than 10 minutes later.
While we have noted when auctioneers must make opening remarks, the courts have also found late-attending bidders liable for terms and conditions announced at the start time of the auction, even if they weren’t there to hear them.
In other words, the courts have ruled basically that the opening remarks are a material part of an auction, and are to be made at the advertised start time of the auction to be enforceable; and as much, if the opening remarks are made at the start time of the auction, they are enforceable.
Secondly, can the opening remarks contradict other printed advertising or disclosures? It is somewhat common to see printed auction advertisement with the notation:Announcements made day of sale take precedence over any printed material
However, can auctioneers change terms and/or conditions of the auction by announcements made at the auction, contradicting printed advertising? Generally, it is seen by both the public and the courts as a troublesome practice to advertise one thing, but offer or demand something else; much like the concept of “bait and switch.”
It is understandable that an auctioneer might have to amend or change some things. For instance, where bidders are to park — where an adjoining lot which was advertised as “available parking” is otherwise unavailable that day. Or, if the newspaper mistakenly printed that the Ford 9N tractor was selling at 11:00 p.m., where that should have been a Ford 8N tractor and the time should have been 11:00 a.m.
While the courts have been forgiving to auctioneers for misprints in advertising and the like, they have been very unforgiving when they perceive the auctioneer purposely advertised one way, and then wants to change that term or condition day of auction; further, the courts have been particularly unforgiving when the advertised terms or conditions are more favorable for the bidders than those contained within the opening remarks.
For example, these are material changes from advertised terms/conditions which would likely result in the auctioneer being liable for damages:
Advertising the auction to begin at 11:00 a.m. and starting the auction at 10:00 a.m.
Advertising the auction is absolute, and then changing it to a reserve auction
Advertising all items will sell, and then announcing $50 minimum bids on all items
Advertising that checks will be accepted, but announcing checks are not accepted
Advertising one “sale order” but announcing a different “sale order”
What can auctioneers do in regard to their opening remarks to save themselves from liability? Make those opening remarks at the exact start time of the auction, and don’t make announcements which are different than advertised terms and/or conditions.
Mike Brandly, Auctioneer, CAI, AARE has been an auctioneer and certified appraiser for over 30 years. His company’s auctions are located at: Mike Brandly, Auctioneer, Keller Williams Auctions and Goodwill Columbus Car Auction. His Facebook page is: www.facebook.com/mbauctioneer. He is Executive Director of The Ohio Auction School.
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